>> steve: fred says, "leaving on a jet plane "makes me cry when they play it at the supermarket where i shop. why is that guy crying. >> brian: you know what makes me cry? when the show ends. >> steve: see you tomorrow. morning, everybody! it's been getting nasty for a while, the governor's race in new york, a whole new bar for nastiness, paladino up against mario cuomo in this race, mixing it up with fred dicker, a newspaper reporter. here's part of that now: >> you're a stalking horse. you're a bird dog. you send another letter to my daughter's house, i'll take you out, buddy. >> you're going to take me out? how you going to do that? >> bill: paladino accusing reporters of going after his ten-year-old daughter and wait until you see what happens next. you'll see the rest of the confrontation. fred dicker is live, minutes from now, we'll get his

version of the events then. first, though, mcdonald's, not loving health care, that's the big question following reports that the fast-food chain is thinking about dropping coverage for its employees, and now the white house is stepping in and we're wondering why is that. good morning, i'm bill hemmer, welcome to "america's newsroom". good morning, martha, did the afternoon yesterday take care of you? martha: yes, thank you g. to be back, good morning, everybody, i'm martha maccallum, thank you for being with us today. here's the issue, the guard en arches is denying those reports that they are considering not providing coverage. bill: the white house is saying the story is flat out wrong. stuart varney, the story is in the "wall street journal," owned by our parent company, by the way. what is the story? >> the "wall street journal" has gotten ahold of a letter from mcdonald's to the feds and that letter says, and i quote, now it would be

economically prohibitive for our carrier to continue offering coverage, they say we can't afford to offer health care coverage for 30,000 of our employees under the current rules of the expected future rules of health care reform. bill, i have to to tell you, the speed and intensity of the denials of the story tell you how important it is. because at stake is president obama's promise that you will be able to keep the program, the coverage, the policy that you've got now if you like it. bill: tell me more about the pushback, the strength of the denial means what? >> well, look, you've got health and human services coming out with a story -- with a response, that says the "wall street journal" story is wrong. mcdonald's itself has put out a story significance that the story is false, we're not going to drop coverage. but neither of those denials, neither of those two statements about the story, denies that mcdonald's is at least talking about the rules or

that it sent the letter saying we can't afford this kind of coverage under health care reform. bill: what a huge company this is, too, it employs tens of thousands. >> look, they offer low cost, low benefit coverage to 30,000 employees. another 1.4 million similar employees, in similar jobs in other industries, also get the same kind of coverage. will they, too, be dropped, or have their coverage changed because of health care reform? that's how big it is. bill: thank you stuart, stuart varney, fox business network, see you at # 20:00 an varney & company. bless you martha. martha: thank you very much, bill! all right, we have breaking news to tell you about on the u.s. con america's 453,000 americans filed for first-time unemployment benefits, that number coming out this morning. that's a drop of 15,000 from the week before and it's the third drop that we've seen over the course of four weeks, and second quarter

gdp was up a tiny fraction, 1.7% annual growth, analysts say it's not a great number, considerable the amount of money needed to get the economy going, but it's in a better direction, to say the very least. bill: 33 days into the mid terms -- until the mid terms, it's a dead heat in one of the country's most closely watched races, nevada. that's the place where republicans hope to pull off a major victory by ousting the democratic senate majority leader harry reid, latest rasmussen reports telephone survey, likely voters in that state finds reid barely edging the republican challenger by a point. reid, 48, sharron angle, 47. both candidates, by the way, were tied at 48 percent apiece but well within the margin of error, as we say, for nevada. martha: if you live on the east coast, folks, you'd better have your rain boots and umbrella. i brought my umbrella, but

not the rain boots. that was a big mistake, i could have used a canoe. nicole is making a messy day and some spots are expected to get up to a foot of rain, as well as flooding as well. add that to the downpours this week and you're going to have a bit of flooding. janice dean is live from the extreme weather center. it's a wet one out there. >> reporter: can i say a shoutout to the hair and makeup team? i did not look like this 15 minutes ago! a drowned rat is more of what i looked like 15 minutes ago. okay, so northeast, mid atlantic, even parts of the southeast, still getting this tropical moisture feed, which is what's left of tropical storm nicole. we also have a frontal boundary and we're going to have an extra tropical low pressure up the coast. so we are not done. this is going to been -- going to be an all-day event, into friday. we have a lot of tropical moisture, jamaica, plenty of

flooding there, cuba, still getting flooding reports there, and you can see this moisture reaches all the way up towards the northeast. look at all of the rain that we are dealing with. wilmington, over 20 inches of rain in less than five days for you. that is record breaking rainfall. you can see all of that heavy rain moving in towards virginia beach, up towards washington. this is a triple threat. not only are we going to get heavy rain, we're going to get high winds and the threat for foreign aidoes, the tornado watch in effect for tarts of the mid atlantic towards the northeast, d.c., parts of new jersey, tornado watch for you until 1:00 p.m. local time. they will probably extend that watch throughout the afternoon up towards the northeast. it is going to be a mess, it's going to be hard to get home today. if you have a flight, be prepared to either wait in the terminal or take -- make a lot of phone calls to see if your flight is delayed or canceled. martha, back to you. martha: from new jersey, that is something you don't hear of every day. janice, thank you very much.

this nasty weather is making it tough to get around. thanks. there's a mess in the air and on the rails, up and down the east coast. what better to do in this situation? i say go live on the plaza in the pouring rain. peter, how is it out there? >> reporter: calm before the storm. but all that rain is already causing tons of problems for people up and down the east coast and most probably haven't even punched into work but the people having the worst mornings so far are flyers, anybody that needs to take an airplane to or from or through the northeast is going to have a rough one today, because right now at newark airport, northern new jersey, they're already backed up three hours and 40 minutes. down in philly, the airport has delays of an hour and 51 minutes and la guardia here in new york, backed up 2 1/2 hours. you can see it's not even raining. if you need to fly make sure you call your carriers. flyers are not the only ones are problems with commutes.

in north carolina, local affiliates reporting there are too many flooded roads to list so there are stkeps of schools that are closed and dozens will have delayed ocean and in south carolina, thousands aren't seeing this report because there's no power and flooding has been reported inland there. right here in manhattan, you can see it's the calm before the storm, but we are expecting things to get really nasty and officials and residents here are really worried about all the rainwater going on top of storm drains that are filled with leaves. it is fall, after all. martha: haven't gotten rain all summer and now we're getting it all in one day t. seems. thank you very much. if you're caught nup the mess, send pictures from where you live and you may see those on the air, fox news.com, give your name and town and we'll show you what's happening out there. a lot of flooding. be safe, certainly, when you head out to do that. bill: and we have a canoe waiting outside, ready to take you home today. send the picture, you report! martha: you know the reporter who was canoeing

through the water and this person walked by in about -- in about 6 inches of water? bill: she remembers that, too, by the way! martha: sorry i brought it up! bill: this is the air traffic in the air, awe the green dots of planes flying pretty much east of the mississippi for the most part. stay home is right, if you can, especially along the east coast. nine minutes past the hour now. up and away they go, our health care costs, about to score higher for all americans? if that's the case, that means more money out of the wallet. how much and what's the cost. we'll look at that. martha: there's a massive toy recall that every parent needs to tpwhoe. at least 10 million fisher price items, some of which might be in your house now. stay tuned, we're going to show what you these things are so you can take them back to the store. bill: these guys might need a canoe. carl paladino is running for governor in new york, we'll talk to a reporter who mixed things up in a big way in the empire state.

what went down? you'll see it and hear it in a minute.

march whoa nelly, check this out a rock slide in interstate # on in colorado sending three to the hospital and closing parts of that highway for hours. two passenger vehicles and a

tractor trailer were caught up in the boulders, emergency responders saying that rock slides, really not too common this time of year. nobody told the wall that i guess. the colorado department of transportation, finding that same stretch of highway as low risk for such a thing. bill: tempers flare. have you seen this? a heated confrontation between carl paladino and fred dicker. paladino is running against cuomo, but in this case paladino accusing reporters of reporters of both ring his ten-year-old daughter. >> you're a lawyer. >> i'm also a lawyer. >> most people would consider this a sneer. >> i want to know why you sent your golds after my daughter. i want to know about it. >> you have a charge against cuomo, do you have the evidence or not? >> at the appropriate time, you'll hear. >> how can you say that about him?

>> i have a daughter, too. >> i have a daughter! >> frank, that's it. >> stay away from me. >> what evidence do you have? >> listen, all right? >> you say -- you're someone -- you send someone after my daughter. >> say it one more time. come on. >> don't touch me. >> who are you? who the hell are you? i'm trying to ask him a question. >> do you have any evidence for the charge you made? it's a simple question. >> at the appropriate time, you'll get it. >> you're a stalking horse. you're a stalking horse. you're a bird dog. you send another gold to my daughter's house and i'll take you out, buddy. >> how you going to take me out? >> watch. >> [inaudible comments] >> and you're working for cuomo. >> not true. i work for the "new york post".

>> how about the evidence that you have that nancy mapels was not in any trouble and you didn't print it when i gave it to you, because you're working for cuomo. you're working for cuomo. you're a terrible journalist. >> thank you very much. >> you're a terrible journalist. >> anything else? where's the evidence on cuomo? where's the evidence? >> when you quit the swings we'll welcome you back, but you're way out of line. >> i didn't sthaeu. >> yes you did. >> i wish i had the notes. >> you clearly have a lot less power than you think. >> i don't have the power. >> frank, if your photographer takes a picture of a ten-year-old again -- why didn't he talk about it openly? >> you're such a biased person. you are so biased. >> thank you very much. >> you're out of here. >> out of here? what does that mean? >> you're off our campaign's list. that's it. you get nothing more from us. you can go back to cud ling cuomo and kissing his butt. >> ad and paterson, too, right? >> kiss his butt, and spitzer, kiss his butt. >> you're so out of line.

you're so out of line. >> i tell you what, get out of my face, step back a little bit. bill: whoa. the "new york post" is owned by parent news corps and fred dicker is the "new york post" state yesterday to, he's live from lake george by way of skype and good morning to you. boy, this hit the internet last night, within moments of the exchange, i want to take it piece by piece fred as much as i can, fred. how did this go down? >> bill, what happened was a couple of hours earlier, politico, the national political online news service, a very important one, had moved the story saying carl paladino, republican candidate for governor here in new york was alleging that andrew cuomo, candidate for governor, was suggest thank he had a number of affairs when married to mary kennedy cuomo and we should be asking about mary kennedy kicking him out of the house when he was married to her. she's are allegations that have never before been made public, nobody had heard of it before, paladino had said

the campaign was get a lot nastier, he was threatening to make it nastier, and when he arrived in lake george with a meeting of the business council, the business group in new york, i was there to ask him about the allegations appearing on phr*eut corks and to ask in particular do you have evidence. bill: you wanted answers on that story. let's move beyond that, now, because what paladino's folks are saying, and we weren't there, you you were, that you egged him, that you got in his face and provoked him. >> that's just not true. what this video is, and it was shot with a cell phone camera, is it picks up almost in the middle of what was going on. when he first came in i have had him -- i asked him very nicely, in fact i have the transcript in front of me, about the allegations he had made and i said the cuomo campaign was accusing him of descending into the gutter by doing this and i said do you have any proof of the allegations and that's when he started taking off on me, on the new york possess, over a story i had nothing to do with that ran on sunday's issue. bill: i think that story, the accusation, we heard

paladino make t. he said the newspaper sent a photographer after his ten-year-old daughter. is that the case? >> i don't think that's so, by the way. bill: did the post do that? you got to understand how a parent could be upset about that, can't you? >> let me explain. paladino when he first announced for governor announced that something that no one knew, he he said he had a child out of wednesday lock ten years ago, that he was on good terms with the mother of the child and she was living in buffalo and he remains close with him. what we did on sunday was do a story about the mother of the child, her life, which i guess we tried to speak with her, we ran no picture of the child and i guess we named the child, but he had already named the child, but we didn't do a story about the child, we did a story about the mother, who apparently is on good terms with carl paladino. so i think he misrepresented what occurred in our paper and was trying to shirk away from his allegations against cuomo. bill: the allegations that a photographer went to the window of this ten-year-old girl, she was getting ready

for a dance lesson and it freaked her out. >> i don't know what's -- i wasn't there. bill: let me ask the question. >> i wasn't asking him about that, i was asking about charges made against cuomo. bill: i understand, but freddy, this is very important, i want to nail this down here, because on that tape, they're accusing you of favoring cuomo throughout this campaign. have you written a negative story about cuomo? >> let me just challenge the premise. one doesn't judge whether a journalist is biased or not by whether you've written a negative story. i've written fair stories about paladino and about cuomo. i've had paladino on a radio show i hosted many times, he was happy to come on, so i don't think it's a fair premise. i think he's saying that to try to shift away from the fact that a lot of people think he just smeared andrew cuomo. >> what is your relationship with paladino, how long have you known each other? you've been covering new york politics for 30 years. >> he's new to politics in new york. since he announced i've had a good relationship with him, i've praised him, he's been on a roido show i host

regularly and never until last night have i had a problem with him. bill: fred dicker of the new york post, whom we have skype dollars. we've reached out to cuomo, paladino, the calls are out there and if they can join us, we'll take them. otherwise, paladino will be on "america live" and will answer more of this tomorrow with megyn. in the meantime, that's where we are today. talk about a heated race. now talking about this negative advertisement going out across the country. you can tell the way things are moving, 33 days away from this election, and that thing caught wildfire last night. martha: it did and for very good reason. it's a very inflammatory back and forth in this case, but you got to wonder if people look at this and say why are we talking about this, we have huge problems in the state of new york and wells. -- and elsewhere. bill: that a great point are voters going to look at the personal or the state of the country and the state of their own affairs, all of that will be ironed out on november 2nd. martha: what's coming up here is that a new report says that starting next

year, rising health care costs really could start to hit your bottom line in a major way, but wasn't health care overhaul suppose to prevent that? our next guest adds up all the numbers for the government and we'll see what they say.

martha: all right, thursday morning, a new report says that health care costs will reach a five-year high in 2011, and that will mean more money out of your pocket, of course, this comes from research that was done by hugh & associates, who's done a lot of research on all the health care costs out there. they say an average employee will have to poeu about 12.5% more in medical costs next year. that's a pretty big chunk of your in corks 12.5%. it's the opposite of what president obama said when he was selling this overhaul

before it passed. listen to this: >> we know what will happen if we fail to act. we know that our government will be plunged deeper into debt. we knee millions more people will lose their coverage. we know the rising costs will saddle millions more families with unaffordable expenses and a lot of small businesses are going to drop their coverage all together. martha: doug holzgen was director of the cbo and president of the america action forum. doug, good to see you, welcome. >> good morning, martha. martha: we were told there may be increases in costs initially as all of this shakes out, but then in the end, the administration said you will start to see costs decline, as everyone is covered. do you still think that will be the case, a few years out? >> no, i think the real problem is that the underlying pace of health care costs in the united states continues to grow. changing that, you know, bending the so-called costs,

should have been the primary objective of health care reform and what we've seen is that all the experts have looked at this, cms' own actuary, the health actuary for the u.s. government, congress at budget office, all come to the same conclusion, health care costs are going to be higher, not lower, under the by, so there's no way to escape that. if you're an insurer, you have to pass along those costs. martha: what we're seeing is that companies are absorbing extra costs, they're passing those along. initially there was talk about $500 billion being cut from medicare programs that was going to pay for this whole care health -- for this whole health care reform plan? whatever happened to that? >> i've never felt the cuts were realistic. when push came to shove there was nothing done in the bill that would allow a doctor under medicare, a nursing home, an acute care facility, to operate their business with $500 billion, so one of two things would happen, government puts more in or stop seeing patients. the latter would be a tragedy so we've got a very expensive bill.

martha: the other thing the president said in the sound bite which caught my attention, costs will go up so eventually businesses are going to say look, you're on your own, we're not going to pay for this health care coverage. perhaps we're going to see that as a result of the bill, actually? >> the bill requires much richer insurance, there's no way around that, it's already begun, costly benefits have to be provided, and every company, small and large, is going to run the financial numbers and some of them will come to the reasonable conclusion that it would be better to not offer health insurance, maybe even pay the penalty that's in the bill and instead send those employees off the exchanges to get government insurance. that's an extremely expense ef proposition, and we've seen like the mcdonald's case this morning, that's the leading edge of what will be a very common discussion. martha: what about the good stuff, what about everybody being covered, what about preexisting conditions when you're on a new plan, you can't be denied, you know, is that a reality, if we're going to have to pay a lot more, is that going to be seen?

>> that became a reality on september 23rd, but the question is is it worth it. there are other ways to solve those problems without the expensive exchanges, without the $500 billion price tag for medicare, without breaking the government's budget and that would have been a much better strategy for the forum. martha: doug, always good to get your take, thank you sir. >> thank you. bill: there was a massive recall just announced on "america's newsroom", 10 million toys, pulled off the shelves of american stores. who you need to know if you're a parent and also the company and toys that are affected. we will get to that. also -- >> martha: plus another day, and frustrated voters out there. there were positive things said at this meeting but we all remember the vel ma hart moment, a woman who said she had good reason to ask president obama when things would finally get better for her family. remember this in. >> i wanted to ask a difficult question because we are in challenging tiles and difficult questions are going to get us moving forward. >> everybody have a seat. martha: now there's another

voice, another person like velma -- vel ma that you're going to hear from who the president ran into at this morning. we're going to play it for you, coming up next. been very d on me -- very hard.

it's the one disfigurement that i've had to deal with since i was a teenager. [ alicia ] it's a catastrophe,

this right before the break. fox news alert on word of a massive recall for children's items already in millions of homes across the country. fisher price, recalling more than 10 million items for infants and toddlers, the products range from high chairs to tricycles, all kinds of toys. david lee mill ser on this story. what do parents need to know about this? >> reporter: the recall really encompasses four different products but there are 46 different models, all manufactured by fisher price, the consumer products safety commission said they involve injuries, children hurt using the tryings and tough tryings tricycles, six kids needed medical attention, the problem, the ignition key that the children fell on.

fisher price is recalling 1 million easy care and easy clean high chairs, the pegs on the tray hurt the kids, and some required stitches. this is far more expansive. even other items have not hurt kids, many pose a choking hazard. on the stand and play rampway, the colorful wheels can actually come off and interestingly, bill, it does appear that many if not all of these toys were made in mexico. bill: whoa, okay, now, fisher price is reacting to this how? what's the company said, david lee? >> reporter: fisher price is saying it will provide safe replacement, as well as fix, but until this matter is remedies -- remedied, all items should be kept out of the reach of children. let me read for you part of the statement released by the company. they said, and i quote, our product engineers have many years of designing safety toeurbgs in addition we monitor parent safety. if we see an issue with the product, at any point, even if sold, and used safely, we

will take appropriate action. the company's bottom line here, bill, is that they say their products are, quoting them now, overwhelmingly safe. bill: all right, david lee miller is in new york on that. stay in the know on this recall. and as you just heard, several products involved here. for a complete list, it's on our website right now, foxnews.com, you can get the latest updates on the story and also a story that affects millions of homes across america now. david lee, thank you for that. 9:34 now in new york. martha: well, president obama, facing some frustrated swing voters during a back yard town hall event in iowa yesterday, first in this sound bite you will hear a small business owner's question and then hear the president's response. let's listen: >> you are sort of strangling the engine that does create the jobs. the fundamentals are profit, $250,000. well, if you're two people in a family, that's not a lot. if seems like a lot but not when you have the family, kids, cars, colleges, all

the things that go, plus you have to grow the engine, you have to grow it to continue to provide more jobs and to create the dream. >> i have signed eight small business tax cuts since i came into office, and the package that we signed this week cut taxes in eight more ways. so your taxes haven't gone up. martha: let's take a look at this, doug schoen, former clinton pollster and fox news contributor and brad blakeman, former department stetant to president george w. bush, welcome, gentlemen. i want to start with the big question because obviously the white white house's strategy is to get the president out there, have him sort of shaking hands with people, chatting with them in their back yards and relating to everybody. how's is that going? this example is just one. >> doesn't look to be going too well, martha. i think that the reaction in demoines was distinctly skeptical, compare that to the reaction the president

had gotten two years ago or more in the iowa caucuses and there's been a seed change in public opinion, and the problem is that his agenda does not really speak to the needs and concerns of middle class, middle income swing voters as we saw in that exchange. martha: what do you think the reaction to this, having been an adviser to a president, brad blakeman, when they go back home to the west wing and sit around and say this isn't working out exactly as we planned, do they start to reevaluate whether or not what they've been doing, the agenda, is working? >> absolutely. there's a constant revisiting of what you're doing and how it affects the message, but the problem with this president is, it's too little, too late. the american people have already formed an opinion as to what this administration has done and more importantly, what they've not done, to make the american economy better. remember, this is the president who told us all along, this is the worst economy since the great depression. so mr. president, why aren't you doing bold action that

the american people can see? why weren't you doing this in the spring and summer? with weeks to go before a major midterm election, the american people have already formed their opinion, and that is the democrats have failed on the economy. martha: you know, it's interesting, just to get specific for a moment about this man's question, doug, he breaks down the $250,000, he says look, you know, i own a small business, my wife and i both work, we make over 250, but by the time you get cars and pay for college, they're not feeling like rich people. you know, what about that message from this voter, and do you think that that will resonate at the white house and will we see all of the bush tax cuts left in place? >> well, i think it should have resonated, march that. peter orszag, it's outgoing budget director, suggested a two-year extension of all the tax cuts and the democrats had run on the message of cutting taxes for at least 95 percent of the american people, so far, that hasn't been accomplished, given the failure to reach agreement with the republicans. the tax cuts for the wealthy

haven't been extended, despite the concerns of 45 members of the house and at least six senators. so i think the tax issue is going to be a huge negative for the democrats. the only thing the democrats really have going for them, martha, is that the republicans are not really offering much as an alternative and that's ultimately what could well minimize their losses in the fall. >> let me disagree, martha, with doug. we are offering alternatives and here they are, doug. let's extend the bush tax cuts to every american, let's have a payroll tax holiday for six months or a year, let's eliminate capital gains for two year, and what about the death tax? those are our plans and that's what's going to put america back to work. martha: in terms of the strategy, we're likely to get a big announcement tomorrow, now they're saying it may even be a rose garden announcement about rahm emanuel leaving, going back to chicago to run for mayor. how does that change that dynamic? we have basically an exodus from the economic team and now rahm emanuel heading back. what's the meaning of all that, doug? >> to me, he's been

desperate to get out. rahm emanuel is a centrist, he's held the obama coalition such as it is together. he was for incrementalism on health care, he didn't get it, i suspect he would have want add deal on tax cuts. he's getting out, they don't really have a strong replacement toe pick up the slack for emanuel there. they have good people inside. but bottom line, they've lost their economic team, they've lost their chief of staff. it is a white house that is drifting, martha, and that will be reflected in the mid terms and going forward. martha: brad and doug, always good to see you guys, a lot going on, thank you very much, gentlemen. >> thank you. bill: a bit more to the story. in a moment, congress heading home with no decision on tax cuts, democratic leaders tag a lot of fire from their own party. what happens to your paycheck, what happens to small business in america? because you asked, in moments. martha: and the old he fell excuse. not quite working here. a police officer, caught roughing up a prisoner.

but does this tell the whole story? we're going to talk about this story. we'll report everything that is seen in this tape and what we learned about it and you ask decide what you think, when we come back.

martha: waiting for an announcement on whether mailing a letter will go up again, if the stamp goes up 2 cents, it would be 46 cents a pop now. get out the forever stamps. -- the forever stamps, the postoffice seeking an increase because it is

bleeding money, folks, it is on track to lose $7 billion this year and also next year we should also learn soon if the postoffice will do away with the saturday mail service and go a five-day delivery week which might be a good idea. congress would have to sign off on that, of course. bill: what did you say? seven -- >> martha: $7 billion. that's a business you might not want to be in! >> bill: don't hold tax cuts hostage. those words from democratic senator ben nelson out of nebraska, he's reacting to his party's decision not to vote on extending tax cuts until at least after the midterm elections and possibly beyond. here's nelson: >> raising anyone's taxes, given our fragile economy, would be a move in the wrong direction. the possibility of tax increase social security just one more reason that companies at home and across our country are holding on to cash and are hesitant to invest in new equipment, new production, and new employees. bill: in the meantime, a lot

of you might be wondering what will happen to your paycheck next year if tax cuts are not extended. stephen moore, senior economic writer for the wall street journal, good morning to stkpwhraou by hill. -- hi bill. >> bill: if you make $50,000 a year, your taxes will go up $2900, starting when, the third week in january? >> january 1, 20 # one. as soon as that clock hits midnight, the new year brings those tax increases. >> if you're making $100,000 a year, your taxes go up $4500. >> yes. by the way, bill, let me just say one thing about this, it depends on how many kids you have, because remember there was a child credit in the 2001 and 2003 tax bill, so this is -- i think those examples you're using are for a family of four with two kids. bill: clarification, it is a family of four, based on our research and our brain room. the president has said he signed eight pieces of

legislation already that provide small business tax cuts, and your tax haven't gone up in this administration, your taxes have gone down. is he right? >> well, he's partly right. it's true that he has signed a lot of legislation that's supposed to help small businesses. the problem is it's only going to help 1 percent or 2 percent of small businesses out there. i gave a talk yesterday, bill, at the national federation of independent businesses which is the association of hundreds of thousands of small businesses around the country, and what these folks were telling me is look, those tax cuts don't add up to a hill of beans. what we really care about is making sure we know what the tax rates are going to be come january 1st. and last night, bill, the house of representatives adjourned, they're done until the election. they have not settled this issue. i think it's a dereliction of duty that they have left washington without telling the american people what taxes are going to be next year. bill: that's on the house side. on the senate side we got a sneak peek of what's scheduled after the elections, and according to our producer, taxes don't

appear to be on harry reid's schedule in the senate, either. of course, all that can change based on what happens on november 2nd as it goes into the morning of november 3rd, but back to my question to you about tax cuts and what the president said in demoines, iowa yesterday, and this is a heavy charge, you say that small business bill is a fraud. why? >> i really believe that, bill. because i think if you look at the lending programs that they're setting up, only one or two percentage of all american small business ever get a loan from the small business administration. most american businesses get loans from their bank down the street, a lot of businesses actually are taking out loans from their credit cards. they don't go to washington to get a loan. what they're concerned about is that they don't know what's going to happen next year with their capital gains tax, with their business rate tax, with the dividend tax, with the estate tax, all of these things are completely unresolved. it's hard to run a business, bill, if you don't know what the tax rate is going to be.

bill: i'm going to put you on the spot here, okay? bya, a lot of questions, because you asked. he writes, what constitutes a small business? anything under $250,000? or is it limited to some amount of employees? >> that's a good question, bill. there's two definitions of small business. some say 500 or fewer employees, others say 250 employees or less. i'm going to say if you're a business with less than 250 employees, you are stud as a small business. that's 70 percent of all american workers today, work for small businesses, with less than 250 employees. bill: you say that's 70 percent? >> yes. bill: the office of advocacy , they take the 500 employee mark. and if you take that number, that's 99.7% of small businesses in the country. 27 1/2 million employees. >> that's a lot of workers. bill: that's a lot.

>> this is the point. it's we all know that this is not a cliche that businesses are the backbone of the american economy and when they're telling me is look, for the last two years, we really feel like we've been the atm machine for everything the obama administration has done, whether it's health care or the stimulus bill, everything is paid for with new taxes on small businesses. bill: let me put that back on the screen, that's 500 employees that we found here, that's 27.5 million businesses. that's a lot more workers than that. let's make that clear. >> that's probably closer to 150 million workers. bull bill and that is why the argument continues the way it does. stephen moore, what's your guess? what happens? do they keep them in place? does the president sign it or not? >> i think the president is going to get this right and i think we're going to get a two-year extension on all the tax cuts and i pray every night when i go to sleep, that that's what happens, because it's the best thing for the economy.

can we privatize the postal service? come on! >> bill: tell that to the folks at fed-ex and ups. they're doing fine. >> they're running a profit! >> bill: stephen moore, "wall street journal," go to fox news/"america's newsroom", click on the box, bya, send me an e-mail, follow me on twitter, bya, because you asked. and my home address is -- we've been down that road. martha: the other way to find bill hemmer, contact me, i'll get in touch with him for you, i promise! here's a real head scratcher, folks. mexican mayors are telling the u.s., please, do not send illegals in your country back to us to jump over the border because they're causing as whole lot of trouble once they get back here. okay? i'm not kidding. a former homeland security official on what that's about. bill: a sign, and an effort to change them. is the case of the nanny

state going too far? lts are ama.

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fox news alert, we mentioned this dangerous weather system moving up the east coast that will affect millions throughout the day and into the evening hours. a tornado warning now for southeastern virginia, a warning is different from a watch, a warning means a torn -- tornado has been spotted in the area. if you're in the area of virginia beach, the signs have been spotted in the sky and the warning is out now. we're going to watch this system as it moves. back to janice dean in our extreme weather center in a moment, so keep an eye on that in virginia. martha: all right, in

california, there's a measure that would scrap a nonpartisan commission that was supposed to redraw the legislative districts there, two years after voters in the golden state the idea a thumbs up but even before the panel has had a chance to convene. what's that all about? william la jeunesse is checking it out live in los angeles. hey william. >> reporter: martha, and unions, rather critics, including the l.a. times, are telling speaker pelosi and the unions and the state democratic party to back off. accusing them of being self-serving and undemocratic and spending millions of dollars to undo the what voters already approved. >> they were perpetrated on the american people. >> jerry mandarin is a movie but this exposes the fiction. two years ago voters approved proposition 11 establishing an independent nonpartisan citizens commission to redraw state

political boundaries. >> i think it was a conflict of interest when you let politicians draw their own lines. >> now this year, proposition 20 would expand the authority of that citizens panel to redraw congressional districts. >> that upset incumbent democrats who propose proposition 27 to abolish the panel and continue to allow lawmakers to draw their own districts. >> proposition 27 is a cynical attempt to undermine the will of the people. >> prop 27 donors include house speaker nancy pelosi and more than a dozen other democrats in congress who gave more than $560,000 to help save their seats in washington. >> they want to draw the line, they want to change the voters, instead of the voters choosing the politicians. >> you have people not accountable to the voters. >> prop 27 supporters say letting amateurs redraw districts may increase competition but jeopardizes the power of encum bansy. >> we will be sacrificing

this in california when we desperately need it. >> two years ago, california had 153 state and congressional seats up for election. not one changed parties. that's why they concluded this isn't about democracy, it's about incom bansy that needs to be changed. martha: interesting william, thank you very much. bill: check this out, martha. the market is moving, up about 80 points already, the dow, over 10,900. are we looking at dow 11,000? can you figure it out? >> martha: september is going to be the best month the dow jones industrial average has seen in a really, really long time. you look at what's going on in the economy and you have to scratch your head and wonder why. gold going through the roof at the same time. doesn't make sense, either. we'll see. bill: wow, 10918 for the dow 30. martha: all right. how about this? governor chris christie fighting a new battle with the powerful teachers union, this is one he's not giving up. why this proposal is new and getting educators really fired up this time.

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martha: we have new details coming in, in the tragic death

of a college student. just a few weeks into his freshman year apparently took his own life because what he thought was happening in private was in fact made very public, apparently, by his roommate. the new york city police department is now reporting that they have recovered a body, that may be rutgers freshman tyler clemente, believed to have jumped to his death off of new york's george washington bridge after two classmates, one of which was his roommate allegedly used a web camera to watch his sexual encounters and then broadcast it and told everybody to tune in. coming up, the serious charges that these students are now facing and whether the law has caught up to the social network. now, as mexico... local mayors there are asking the united states, can you please stop deporting people who cross from our country into yours illegally, it is causing problems on our side of the border. a coalition of mexican mayors

saying the influx has sparked deadly violence on their side of the border. because many of those returning nationals, turns out, they are convicted criminals. bill: bad people. martha: what a shock! that is how we start a brand new hour of "america's newsroom," so glad to have you with us on this rainy thursday in new york, i'm martha maccallum. bill: good to be indoors. martha: nice to be inside! bill: your canoe is waiting for you, martha! i'm bill hemmer, the mayor of juarez blaming u.s. deportations for bloodshed, saying 80,000 illegals were dropped in his town the past three years and about 28,000 of them with records for rape and murder, and another -- other violent crimes, julie myers, president of immigration and customs solution, former assistant secretary of homeland security, and, good morning to you. >> good morning. bill: you say you ash not surprised by the reaction to the mayors? why not. >> unfortunately the people we most want to deport are the people other countries don't want to take back and i'm not at all surprised. the mayor -- the mayors have a horrible problem with violence

down there and are desperate and don't want the criminals back. bill: mexico blames the u.s. do they have a point? i mean, once they are in mexico, they are free and can do what they want and if mexico cannot handle it, they've got issues. >> they absolutely have issues. the u.s. provides intelligence about the individuals that are being sent back but the u.s. cannot be forced to absorb these criminals. into our country. they are mexican citizens and mexico has to take them back. bill: what is the solution in all of this, get better south of the border. >> i think, absolutely. make the border more secure, but, i think the mexican border mayors should talk to their own government. there is a program that deports individuals into the interior of mexico, but the mexican government has refused to allow that program to include violent criminals and that could make a difference and they ought to talk to their own government about changing the nature of the interior repatriation program. bill: why hasn't that changed? what is holding that up.

>> i think the mayors, of the interior of mexico, don't want the criminals, either. and, so the united states has been forced, every, single year, to renegotiate the interior repatriation program, and it has always been a voluntary program and mexico refuses to make it mandatory and they've always refused to allow violent criminals. bill: we need to make this clear. does the u.s. have an obligation to provide information to the mexican government before these criminals cross back over the border? >> the u.s. does that, the u.s. provides information when it knows about criminal activity, and provides that information to the mexican government, and, frankly, the u.s. has definitely increased its enforcement resources down at the border, because, we are all concerned about what is going on in mexico and want to be ofs as much assistance as we can. bill: and your deal is the mexicans know it is coming. >> they absolutely do. and, you know, the u.s. cannot be forced to keep the mexican criminals who violated our laws in the u.s., after they served

their prison times. bill: julie myers, thanks for coming in, breaking news earlier today and thanks for your input now, four minutes past the hour, you've got it. martha. martha: if you are not convinced a war is going on miles from our border, here's the hard facts. more than 5700 people, 5,700 people, killed in cartel related violence in the first six months of the year and so far, there has been more than 1700 homicides this year, in ciudad, juarez, a stone's throw from el paso, texas and it all happened since calderon, the president deployed mexico's army to fight the cartels late in 2006. since then more than 28,000 people have been killed and you see what happened with five mayors in mexico. just over the recent weeks. now, some of this might be explained in terms of the astronomical death toll by things like this: 29 men and one woman cuffed late yesterday, south of the border,

they are accused of being members of a ruthless drug cartel, check out the arsenal, dozens of heavy automatic weapons, two shoulder fired rocket launchers along with a stash of grenades, ammo and thousands of dollars in u.s. currency, rounded up in a series of raids in less than 24 hours, and foxnews.com has an in-depth report on this, detailing mexico's claim, the immigration crisis is causing problems on their side of the border, check it out on foxnews.com. bill: suspects behind a foiled terror plot, targeting european cities in these countries, reports say the suspects have ties to the region, 8 german and 2 british brother, of pakistani origin and apparently, they have been calling acquaintances in europe to help with logistics, and, a source telling "the associated press" the suspects are hiding, in pakistan's waziristan region where the u.s. has focused many of its recent drone missile strikes, and, one of the british brothers

reportedly have died, in a recent cia strike. martha: we have a brand new report out of pakistan, that says another person is now being held for an alleged role in the botched times square bombing. this as we learn troubling details about the u.s. suspect, who is being held. prosecutors say faisal shahzad, carefully selected the attack site because he knew there was heavy foot traffic in the times square area and believed his bomb could kildow 40 people. and we have also learned that he planned to attack again if he was not caught after the may attempt and, apparently spent 40 days overseas preparing for the mission and s mission. he pleaded guilty and is expected to be sentenced next week. coming up, stunning video that shows what might have happened if the bomb had gone off in times square, as he had planned. and, in the meantime, an economy on shaky ground and a deadline to extend the bush tax cuts is looming.

congress is packing its bags and heading home. does that make sense? members of the house and senate voted to adjourn today and freeing up lawmakers to return to their districts in these crunch final five weeks before the november midterm elections and there is a lot of backlash surrounding the decision to bail out on what most people think is their day job and head home to do campaigning, molly henneberg is live in washington, so, why -- here's a real big question for you, molly, why didn't democrats have that vote they were supposed to have on tax cuts before they left? >> reporter: hi, martha, apparently there was not enough unanimous opinion especially among the rank-and-file about what to do about the bush era tax cuts and some democrats wanted to go along with the republicans and extend all of the bush era tax cuts, because they say it is a tough economic time and you don't want to hike taxes on anybody coming in the the new year and other democrats including most of the leadership want to do what the president wants to do which was extend the tax cuts, for families making under $250,000. so, what do they decide to do? punch it to lame duck, the lame

duck session after the midterm elections when they come back on november 15th, and harry reid put out his list of priorities for the liame duck session and t was not on his initial list of what they intend to get back to after the midterm elections. bill: they passed a measure to keep the government running, though, it happened late last night, right? >> reporter: right. the government will not shut down, it will have its funding, when the fiscal year starts, october 1st, stay at current funding levels until december 3, what the resolution said last night, through december 3rd, all the current funding levels stay as-is, and, that means federal programs can stay up and running and government will stay up and running and when congress comes back, they'll have to deal with it at some point in the lame duck session to tack a new continuing resolution or spending bill to fund all the government perhaps. martha? martha: very interesting. how the wheels are turning there, moll. martha: thank you very much.

bill: you thought all of this would be over on november 2nd. right. martha: yeah... bill: november and december will be interesting. martha: how about if we said we don't want to do those shows another next couple weeks, we'll just adjourn, adjourn and work on stuff we have to get to here. bill: take care of yourselves. martha: there would be two other people sitting in these chairs, don't you? and that may happen on capitol hill, too. bill: 9 minutes past the hour, the story at the university campus, shell shock by an awful tragedy, a young man's roommate is accused of spying on him with a video camera and the roommate streamed it live on-line and it may have helped this end this man's e very young life. martha: and, he got taken downtown, and, then just got taken down. cops say there is more to this videotape than meets the eye. we're going to find out what that could be. right after this. bill: he's not pulling any punches, new jersey governor chris christie taking on the teacher's union and now he might

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you can make it in just 14 minutes. mmmh, orange chicken. great. i didn't feel like going out anyway. [ male announcer ] wanchai ferry. restaurant quality chinese in your grocer's freezer. bill: a bit of a wash-out on the east coast and it will affect millions, tropical storm nicole mixing with a low pressure system making for a travel nightmare and flood watches and warnings in effect from south

carolina through new england and putting shelters on stand-by and look at the situation, newark airport in new jersey, bottom part of your screen, pounded now, extensive delays, now reported, travel will be a nightmare, we know that and also a tornado warning has been issued in southeastern virginia. watch that story, if you are in the area, tornado has been spotted, so take cover if it affects you, happening right now. martha: new developments to tell you about in the horrifying story out of a new jersey college campus. the n.y.p.d. is now saying that they believe that they have recovered the body of this young man, a rutgers university freshman, just started college a few short weeks ago, tyler clemente, 18 years old, reportedly jumped off the george washington bridge, to commit suicide. after he found out that some of what he was doing in his dorm room, a sexual encounter was actually being streamed live on-line, by who? the police believe that it was by these two.

his roommates, his friends om high school, reportedly turned on the web cam on the computer in tyler's room and then let everybody know about it. kimberly guilfoyle is a former prosecutor and, dr. keith ablow, a member of the fox medical a-team, this is incredibly heart wrenching story for any parent who sent a child off to college and three weeks into the situation, these -- if this is true, these completely unfeeling kids, put this boy in a situation that, for some reason, he felt there was absolutely no, no way out of, that he would never recover from this. is the, you know, the only way i think to look at this and let's pull up, some of what these two, the roommates, roommate, and the other girl, molly, what they put on twitter, from darn robbie on september 19th, roommate asked for the room until midnight and

i went into molly's room and turned on my web cam and i saw him making out with a dude, yea and then, a fi days later, and then he gets on again, anyone with ipad a dare you to video chat me between the hours of 9:30 and 12:00, yes, it is happening again. and dr. ablow, let me start with you. you know, where do you begin, to try and impress upon these young people the amount of devastation you can inflict on somebody with this. >> look, martha, i think what we are seeing here, really is the dehumanizing, depersonalizing aspects of the technology, yes, we have to get the word out you can hurt people with this. this is real. but, we also in doing that have to acknowledge and take account of the fact that these tools, depersonalize and dehumanize and i don't think mr. ravi or molly are deep in they're souls, killers. now, if what they have done here

is proven true they did kill somebody or contributed to his death, directly. but, using skype, using twitteder and using things that remove them from their violence, similarly, the poor kid, mrmr. mr. clemente says on facebook i will kill myself. i don't know how real they imagined any of this was. martha: kimberly, let's talk about the legal side of this. it is becoming increasingly frustrating that there are not ways to hold people like this culpable for their actions, as i understand it, they are up on invasion of privacy charges, which seems a little light to me, frankly. >> when you think about the consequences of their actions. and what it looks like, it appears, that resulted in the death of another young human being with a promising life ahead of him who apparently felt this shame and humiliation, directly from the hands of these two college classmates, that are a cold-blooded, intentional killers? no, did they act in a reckless disregard of h young man's

feelings, privacy, human, yes. and look at the end result, the law found new ways to protect individuals, to respect privacy, and, these two college kids are now going to be made an example of, martha. martha: in what way? what do you think is likely to happen. >> i'll tell you, they are looking at five years behind bars, maximum penalty for an invasion of privacy and transmitting the tears, which is illegal. martha: that is the legal step that gets them to five years if they transmitted the images, that is almost, you know, commerce sort of invasion, almost like putting pornography on the internet, is that right. >> that is exactly right. you are not allowed to capture images of someone else in the nude, sexual acts, as such and transmit them across the internet. if you do that then you are committing a crime, and that is the way the law gets around it, because, they didn't in this case have consent. martha: let's hope the law kicks in here the way it needs to and

what do parents need to do to convince a child like this in a situation, that it's okay, and they can talk to somebody and it is not the end of the world and they will get beyond the moment and, it seems insurmountable to them at the time. >> it is always the case you do it in a loving way and say, listen, we have seen it, too, right? we have seen -- can imagine what happened, we don't even have to look at the tapes, we love you, this is going to be a blip in the screen of your life, you don't need to worry about this long-term, you will get through it because, you know what? you are strong enough to do that. and, nothing that appears on the web, it is here today and stays there, certainly, but, the bottom line is, listen, this is a very forgiving society. despite the fact that we see all of these things the bottom line is our attention span is about an instant and i would say to that young man, believe it or not, ten years down the road, we'll be laughing about this, we'll say, it was a tragedy but we'll be looking back from a great profession, and a

wonderful relationship, and, these kids will be struggling more than you. martha: dr. keith ablow, thank you very much for weighing in, very important message that you are putting out there for parents and for kids. and, kimberly guilfoyle, thank you, we'll follow this on the legal level and see what happens to these two students. thank you both. >> thanks, martha. bill: 19 minutes past the hour now, thankfully for all of us he failed, accused of trying to detonate an suv packed with crude explosives in times square. heart of manhattan, what would have happened if he succeeded? we have videotape that shows you what the potential outcome would have been for dozens of people. martha: wouldn't want to mess with this guy in the middle of the sfwhoodz one young w-- wood young worri warrior who took dos bear, you don't want to miss this ♪

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bill: 17-year-old girl out of michigan joined the ranks of the big game hunters, meet jessica olmstead, i guess she's your run-of-the-mill high school senior, white except when packing a bow and arrow taking down a 450 pound black bear 16 yards away on her first bow hunts and may have gotten more than she bargained for. there she is. >> at least 300, 350 and when i looked at a and got close to it, i was shocked and i didn't know what to say. bill: what do you say? martha: no idea! bill: a big bear in the woods! jessica's father has been training people to hunts for 30 years and insists his daughter

is the best student ever and the best student yet. martha: i think she is, don't you? you know what i would say -- help! somebody! bill: nicely done. martha: oh, my! martha: all right, following up on one of the hot stories of the day, folks. i'm over here. we spoke with "new york post" state editor fred dicker, a while ago, about his side of the story on the heated confrontation he had with republican candidate for new york governor paul paladino and for more on how it went down is eric sean who follows all of the twists and turns and this is interesting. >> reporter: and you need a boxing referee in the governor's race after what happened, accusations of marital infidelity, just part of it. republican candidate, carl paladino accused reporters of not digging into the past of his democratic opponent, new york attorney general andrew cuomo. and, he has suggested that como had affairs during his 13-year

marriage to carrie kennedy-cuomo, the daughter of robert f. kennedy and paladino accuses the new york media of ignoring it all and writing about his ten-year-old daughter who was born out of wedlock. well, it all came to a head last night between new york state editor of the post, "new york post" editor, fred dicker and paladino and the expletive relationed argument when dicker asked what proof paladino had of cuomo's exposed affairs. >> if you have any evidence to the charges, you have -- >> a simple question. >> it is inappropriate, you are not entitled to it. at the appropriate time you will get it. >> this is the attorney general of new york. where is your -- >> you are stalking, you are his bird dog and you send snore goon to my daughter's house and i'll take you out, buddy. >> you'll take me out. >> yes. >> how. >> watch. >> that he accused him of doing cuomo's bidding and fred dicker

said he has been fair, this morning. >> there were fair stories about paladino and cuomo and i had paladino on a radio show i host many times and he was happy to come on and i don't think it is a fair premise. eric: monday a interviewed paladino about the coverage of his daughter and his wife and daughter accepted her and he says buddies in the media need to give cuomo the same investigation he has got. >> i have a beautiful daughter, i have raised her, she's a sweet child, she shouldn't have to deal with this. come on. you know, this... we're grown-ups. wants to take a shot at me, fine, throw your best shot, bid, i'm not and in tim dateable person -- intimidatable person. eric: as for the potential cuomo affairs, a spokesperson said they will not descend into the

gutter with paladino and the people of new york deserve better dialogue from candidates an journalists. was their statement. back to you. martha: all right, eric sean, we have not heard the last of this one, i expect. thank you very much, eric. eric: we're on it today, martha. bill: here is another serious charge. she is just a little housekeeper but might have a huge impact on one of the nation's most talked about political battles, the allegation and the response, the full story, in moments. i martha: stick around and the foot brawl, folks for a second chance at hand shakes and high-fives, a move to save the season for the football team, just ahead.

martha: working on right now on "america's newsroom," fisher price recalling millions of toys, they say could seriously

injure your kids, more than 10 million toys and products are part of the recall and you can see a complete list at foxnews.com and check out what you have at home and, jp morgan chase set to freeze foreclosures for about half of the country. because of flawed paperwork. the decision is expected to affect about 56,000 borrowers in 23 states, where allegations of forged documents and signatures are being used to overturn court ordered evictions. and saying so long to a hollywood legend. actor tony curtis, passed away at his home near las vegas. he was 85 years old. he will be missed. bill: new developments in the the botched bombing in times square, videotape that shows what could have happened in the heart of manhattan had the bomb been successful. would say here. [explosion]. bill: the federal government conducting the test, earlier in the year, packing a nissan pathfinder with explosives,

identical to the ones that were planted in new york, and thankfully the bomb did not go off, james carafano with the heritage foundation and the guy is talkings apparently and he said he planned another attack to be carried out two weeks later? how do we know if that is the case? is he just talking? bragging, running his mouth. >> there is a lot of corroborating evidence, in this case, to believe this guy is not alone, that he was connected to a national transnational terrorist network and this is incredibly disturbing, both this and the detroit... the bomber trying to blow up the plain comi-- plane, coming into detroit, several months before that, it is troubling, you had a known tactic from a known enemy using a known network and but for the grace of god, both would have worked and those are exactly the kind of attacks we have spent, you know, 9-plus years since 9/11 building the system to find and the fact that both of those

got so close to fruition, boy, that really should be troubling. >> the word you used earlier, what was it, incomprehensible? unable to be understood, nine years later and you talk about the evidence against the guy. there is a videotape that came out of pakistan that shows him training there. is that a fact? >> yes. yes. and this is... and, this is amazing. i mean, this is -- you have somebody using a car bomb, where have we seen that, all over the world, from a group in pakistan, with connections in pakistan, look at the detroit guy, he came out of yemen, we knew terrorists were coming out of yemen and people were associated with the al qaeda in the arabian peninsula, and, we certainly knew about the tactic of strapping explosives to your body. both of those should have been no brainers for the government and contrast those with the plot we foiled in europe, and that is the way you are supposed to take a plot down, as you find out about it ahead of time, and you take these things down early, so, i am hoping that both the

times square case and detroit case were wake-up calls to the administration. bill: let me mention europe in a moment, though, but, here's one thing i think is important to clear up. this guy was living in the u.s. and that is part of the homegrown terror we have cove co understand, much better now than even two years ago and he was a transnational and he was back in pakistan and that, you say was in a league of its own. why. >> there is a big difference there, we foiled at least 32 plots since 9/11, and a lot of them have been homegrown and i am not discounting homegrown terrorism, the case of fort hood. that was horrific and the point is when you have the capacity, to reach out to a transnational network, and coordinate and get support and direction and maybe synchronize things, you can do really, really horrible things, and you know, the good news here is we haven't seen anything lately we haven't seen before. and, but, you know, you have to be on tap of the stuff, 24/7,

365:you have to worry about the homegrown stuff and look, we have law enforcement here and we have lots of domestic capacity to look at things and these transnational things, if you consider the sanctuary and plan and organize something, eventually they'll get you, not just staying on top of terrorism but winning the war in afghanistan and getting the pakistanis to do their -- take care of their side of the border, we're never going to be at peace and never going to be safe until that is done. bill: i'm out of time, thanks for coming in, from the heritage foundation. >> thanks for having me. bill: you got it. martha: center stage in the battle for control of congress right now, because, four house democrats in california are said to be major targets for the g.o.p. and, the stakes could not be higher especially when you consider the future of nancy pelosi who hails from san francisco, carl cameron is live in lenore, california with the latest of what is going on

there. >> reporter: the unemployment rate is routinely higher than 15% and a lot of it is because of water rights and a big problem with water and the cost of it and a lot of the farm land is barren and like the country, the republicans are looking for 39 seats for the majority and they only need a handful, to shake things up in california, and there are 53 congresspeople from california, the nation's most populous state and this is certainly a battle ground not only for governor and u.s. senate but house races and of the 53 house seats from california, right now, 33 of them are in democratic hands and 19 republicans and one is vacant and four incumbent democrats are considered vulnerable and in every, single case are swing districts where republicans have had chances and held the seat in years past and now the economy is really the drag and the jobs problem, in california, over 12% unemployment and somepla places the directly held districts, unemployment is the worst in the state and some cases, it is as i said 15 to 18% and this is

ground zero, the valley hope forgot, in large measure because of federal water policies that shut off the pumps, and you see a lot of idle land here. martha: an interesting metaphor, nancy pelosi, how is she holding up in all of this. >> reporter: the democrats are making a big deal about going after the republican minority leader john boehner, and, trying to put a face on the g.o.p. and there is no shortage of faces for the democrats, the president is not on the ballot but is very much part of the debate and you have harry reid from the nevada in a tough race there and nancy pelosi who is not in a difficult race for her re-election to congress, but, her house speakership is very much in jeopardy and virtually every nonpartisan objective analyst now says that it is likely that republicans will take back the house, they crested the 39-seat needed threshold and, are eyeing possible pick-ups between 40 and as many as 50 seats and that means nancy pelosi, favorite

daughter of california, is potentially done as the house speaker. and, in places like this, in her home state, there is an awful lot of voters, even democrats who say they are okay with that, because they are tired of what they consider to be an unacceptable obama-pelosi economy. martha: very interesting, carl, thank you. thanks a lot. bill: carl is in california every week and a story, meg whitman firing back against claims that she knew her housekeeper was in the country illegally, yesterday the woman and her attorney, gloria allred held a news conference and today she says she'll release evidence showing whitman was fully aware of the maid's illegal status, as far back as 2007 3, the allegation an whitman calls the allegation a political stunt saying the maid volunteered the information in 2009, and, then she was promptly fired. >> the charges are not true. they are absolutely not true. she was a great employee, we had a great relationship, it is absolutely a lie.

bill: what it man in a tight race now with the -- whitman in a tight race with jerry brown and supporters questioning allred's motives, and said she is tied to the democratic party and once gave money to her opponent, jerry brown in california. martha: you remember this, the captain said shg, brace for imp everybody and the flight attendant kept saying, heads down! our favorite video of the week and one person kept his camera up there with one hand and today, the pilot who put the plane down safely is telling his story, and, looks like another sully. bill: first time we have heard about that. and also he's not the teacher's pet, new jersey governor chris christie, taking on what is going down in your schools and is about to get backup from a very powerful friend. >> if school failed 25 years and you know they'll do exactly the same thing this year they foiled for 25 years -- failed for 25 years, that kind of a craziness has to end.

>> i'm jenna lee along with rick full bomb, an alleged mumbai style attack on western targets, new details whoof the times square bomber was planning, the disturbing tapes of what could have been in the heart of new york city, and the second plotted was just learning about how safe are we? we'll ask new york city police

commissioner ray kilelly, our guest. rick: and a dramatic escalation on the pakistani-afghanistan border and pakistan is cutting off a key u.s. supply line after a coalition attack inside of pakistan, more on that and a major scientific discovery what could be an earth like planet and' weather disaster from the tip of florida to the northeast, a travel nightmare, the latest, straight ahead. bill: thanks, see you in 17 minutes third quarter pil minutes, sparks are flying, as the delta flight, landing in new york and there's the flight attendant "heads down", a rough landing after the landing gear failed to lower into position and captain jack conroy, thanks his crew and passengers for keeping their heads, well, keeping their heads down! >> the crew performed their duties flawlessly, with complete

professional during our emergency landing at j.f.k. saturday night. i would also like to thank the passengers, who remained calm during the entire process, and proved that once again new yorkers are a special breed of people. >> i'm retired navy and i have -- this is... this is the most significant incident i have ever had in the 32 years that i have been flying. bill: that is saying something, huh? captain conroy, well done, he's our man of the day. thank you, captain. martha: yea! >> our schools failed 25 years and you know they'll do exactly the same thing this year, that they failed 25 years, that kind of craziness has to end. we have to go to the educators and say it is our job to come up with innovation and fix it and if we adults have to work longer, we have to work longer and cannot let america's children down. martha: boy, that is the spirit, right? you may recognize jeffrey canada for the waiting for superman

documentary we have been highlighti ining here and it pu spotlight in the u.s. school system well, have to pull together and do something about, two high profile politician are tackling the issue head on and we have showed you a lot of scenes from governor christie of new jersey and what he has been doing out there and new york city mayor michael bloomberg is fighting to end automatic tenure, automatic job security for teachers who have been there for three years which is something that typically kicks in at three years and the teachers union, as you may expect, not too happy about that situation. and our guest today, the deputy mayor of community development in new york city and a great guest to have, thanks for coming in today. >> thank you for having me. martha: are we about to see a major shakeup in the public school system. >> it is starting, what you heard jeff and others talk about, especially the mayor is looking at how we reform the system, to make sure that it improves educational outcomes for our children and i think what has happened is that when the mayor was running for office

in 2001 he said he wanted to be held responsible for education, not a dysfunctional board of education, separate an apart from the governor and what the mayor has done is really changed the dynamics of new york city of education and taking control of the system. martha: in terms of tenure, what they are saying now, governor christie in new jersey and mayor bloomberg is, they don't want to take away tenure from what i am hearing but want to make it more difficult to get it, and for people to -- >> it should be earned. martha: why have it at all. >> people want job protection. martha: is job protection doing a good job. >> a lot of the new, younger teachers, want to do a good job and don't want a lifetime guarantee and the mayor and governor are talking about, we want to put systems in place to rate teachers and make sure they are effective and once they are rated effective and granting them tenure, and, that to me is part of the revolution, that is taking place now. and this is night incoot a knoc teachers, the majority of them are doing an outstanding job but

agree it didn't be granted automatically and that what is the mayor is talking about, i spoke to a bunch of parents and i grew up in the public school system in new jersey and you in new york and they were saying how will we do it? judge who is is a good teacher and a bad teacher and, i think, everybody knows. even the school system, your area, in your school, everybody knows. >> even the teachers know. martha: who the good and bad teachers are. >> and teachers know so-and-so is not doing a good job... and what we're saying, even the teacher may not be doing good jobs, we want to put supports in place to make sure the teacher is doing a good job, you don't want to throw them out, we want the raise the quality of teachers. martha: my fear is that, this movie brought a lot of attention to the issue, a ton of good, charter school programs and catholic school programs and things people are involved around, that are trying make a change and once the spotlight is gone and once everybody has seen the movie and election roll

around, how powerful do the unions stay in the situation and perhaps tamp down what people are fired up about. >> a couple of things, what the movie did was show charter schools but a lot of good noncharter schools are out there as well, in new york city we have broken up a lot of failing schools and created a lot of new small schools, middle schools, high schools, to do a better job than schools that it replaced and once the issue dies down as far as the movie is concerned, it will be there, the president raised it, incentivizing states, to do a better job, in terms of education and with teacher evaluation and closing failing schools, that is built into the legislation, and i think the onus is on us to do it, it takes tough love and we're seeing that. >> also community outreach and parents to be aware, we don't want to remove parents out of the discussion, they have to demand from us in government that we provide quality schools and that is what the mayor has been talking about.

martha: dennis wallcot, thanks for coming in. bill: sense the outrage, growing every week, did you live east of the mississippi and don't own an umbrella, get one, a super-soaker up and down the eastern seaboard and a tti significant tornado threat is on the way. we'll be right back with that. ♪ ♪ i'm singin' in the rain ♪ just singin' in the rain ♪ what a glorious feeling ♪ i'm happy again...

bill: okay. back to the story in texas. pee-wee football, i think that is 6th graders. and the scuffle between the players, turned into a brawl with the coaches on both teams, turning on each other and the coaches suspended. and now the teams are united trying to save the season, see

they have been told they cannot take part in post season play, and that is not sitting pretty with the players and is not sitting well with the parents who argue the kids shouldn't be punished because of the adults' actions, the football league standing by its decision, here's an adult talking to the kids after they were told the decision apparently is final. >> those are your neighbors, these are players that you will play with in junior high and high school and we are bonded, you understand that. >> yes, sir. >> 1, 2, 3. >> patriots! bill: we hear the parents are considering hiring an attorney and police are looking at the video to decide whether or not assault charges should be filed. not cool, guys. martha: should let them play, the parents have to learn the lesson in that one, i think. i think so. live on the gulf coast is far follow back to normal, more than -- far from back to normal, lasting images of crude floating in the the water is plaguing

seafood sellers, to this date, consumers are still not buying it. phil keating is live on the story, hey, phil. >> reporter: unfortunately for all of the fishermen, people who rely on the seafood industry from louisiana to florida, the rebound post oil spill has not happened yet. and they are hoping it happens next year, because of this slack demand, for seafood, feeling it is not safe to eat, you have shrimping boats not going out on the water, shrimping and sitting there in the marinas and noaa, the national oceanic and atmospheric administration reopened, repeatedly more and more federal waters from a high of 37% of federal gulf waters off limits, it is now down to 13%. but fish wholesalers like the joe patty's seafood of pence coal la, sales for this year are down to date more than 50% from this point last year. their issue is a demand issue, for months, the nation watched tv news and oily waters and

animals and the source of everything for sale at the counter, exactly where it was caught, is now clearly marked for all customers. >> people didn't ask where it came from and now, today they do, and ever since the spill they want to know where it comes from. >> reporter: what is happening is much of the public still prefers eating seafood that was caught out of the deep water horizon pollution zone. the reason pensacola seafood festival brought out a lot of locals to support their local fishermen, the local comfort was gulf shrimp and fish and is not widespread nationally, despite repeated reminders from the federal government, scientists and seafood associations that the gulf seafood is perhaps, right now, the most tested seafood in the world, and perfectly safe to eat. and louisiana's seafood association which represents about 70% of all activity out there in the gulf, have a three pronged attack involving celebrity chefs from around the country to constantly remind their markets that, look, we are

cooking it, it is safe to eat. martha. martha: thank you very much, phil keating in florida. bill: he supports the tea party movement and wrote a kids book about it and why is he now fearing for his life? stick around, happening now has that in minutes. 's has made cha. adding lower sodium sea salt to more soups. plus five dollars in coupons to get you started. campbell's condensed soup. pass it on. campbell's.® it's amazing what soup can do.™ medicare supplement insurance plan card. wherever you go, nationwide, your coverage travels with you. and that's just one of the many reasons... you need a card like this. with all medicare supplement insurance plans, you can choose from a range of plans...

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martha: all right, so here's the story, forget an ohio police officer allegedly caught on tape rough anything up a prisoner, cameras looks like this, he walk as 22-year-old into jail, shofs him into a wall and oh, gosh, ouch.

throws him across the room. then when the prisoner is down the deputy knees him in the back and the deputy says he was reacting after the prisoner tried to head butt him. the suspect is also facing separate charges for domestic violence and assault ago police officer so there may be truth to that. whether or not that skaouzs what happened after that, we'll leave it up to the courts to decide, the summit county sheriff is recommending a 30-day suspension for that officer. bill: man up, fella! thanks to cosmo magazine, i hosted a round table about the changing roles of men and women in america, bottom line, the majority claims today's guy has it tougher than previous generations. martha: oooh! bill: on a serious level, it's one of the hottest topics in america. whether you agree with it or not, that's what it says. martha: two young men, my sons, they're not on the decline, i have a